Virtual Economy Research Network's purpose is to promote academic research in the area, serve as a research resource, and enhance communication between scholars and developers. The main features of the site are a blog, an email list and a bibliography. Read more...

News, research and discussion on virtual goods, currencies and economies globally.

EVE Online Fanfest, QEN, and research co-operation with CCP

The fourth EVE Fanfest, an event giving the EVE Online players an opportunity to meet each other and the game developers, was held in Reykjavik 1. – 3. November. There were two interesting revelations in the event, which also sparked discussion in panels and roundtables, a part of which I’ll try to summarize here. The first one had to with a soon-to-be-published white paper on the EVE player democracy, and why it actually might not be wise to call it democracy after all. The second was about the soon-to-be-published EVE Online Quarterly Economics Newsletter, Vol.1, No.1.

In addition to these two interesting matters, there’s also the reason why a representative of Helsinki Institute of Information Technology (HIIT) was present at EVE Fanfest this year, namely, a recently formed agreement of research co-operation between HIIT and CCP, the operator of EVE Online.

Council of Stellar Management a.k.a. player democracy

The idea of some sort of player representatives, it seems, is actually old in EVE. A few years ago, there was a group of player representatives, hand-picked by CCP, that were in some manner meant to voice the players’ opinion to the developers. For one reason or another, the system was abandoned later on. Similar system is now in use in Star Wars Galaxies.

Now CCP’s plans to introduce a democratic system, in which the players get to elect representatives into a “Council of Stellar Management”. In the very short, any player can be a candidate for the council, and every account gets one vote. In an EVE-ish manner, there are no restrictions on how the players can promote their candidacy, as long as it happens within the restrictions placed by the EULA – so bribing and blackmailing, among other things, are ok (inside the game at least). The council’s role is, simply, “to make EVE better”. I figure there are at least three reasons for CCP to want to introduce such a system. First, it sounds cool, fun, and unique. Second, it would be a medium, far better than e.g. any noise-ridden forums, through which the players could voice their opinions and needs to CCP. Third, it could help CCP in building up trust in the eyes of the players, especially considering the couple of incidents they’ve had this year.

After the presentation of the idea, it got shot down in a panel discussion. The playing of devil’s advocate was done by fifty years of combined MMO experience, a.k.a. Richard Bartle and Jessica Mulligan. From my point of view, their main argument had to do with how the council is promoted: it would be misleading to call the council a democracy, as the developers of MMOs always have the final say in everything. The council, though elected by a democratic process, does not actually get a vote, only a say. This is opposite from what people usually think of as a democracy, thus potentially leading to expectations that can’t be fulfilled. Of course, even infeasible ideas by the council still do carry an important message – that there’s something in the game that the players wish to change for some reason – but, to be sure, the council has no power over the developers. Therefore, names such as democracy or government are inappropriate.

A white paper on CCP’s plans, written by Petur J. Oskarssen, was due to be published last week, so I guess it can be expected any day now. I’ll update this post with a link as soon as I have it. It remains to be seen how the white paper actually presents the idea after the discussion and comments in Fanfest.

EVE Online Quarterly Economics Newsletter, Vol.1, No. 1

After publishing a couple of analyses on the markets of EVE Online (found here and here), the recently nominated lead economist of CCP, Dr. Eyjólfur Guðmundsson, has now turned to the macroeconomics of EVE. The Fanfest-goers witnessed a preview of the main results of the first Eve Online QEN. The lecture is also available via EVE TV (behind the Friday tab). More in-depth analysis should be in the paper, which should also be downloadable this week, and I’ll post an update once I get the link.

The results that were shown dealt with demographics (in the in-world sense), monetary system and the price level. The actual paper is supposed to also include some wealth distribution analyses, but those were not shown in the presentation.

Perhaps the two most interesting results were the distribution of players between the more secure and the less secure areas of EVE, and the price level discussion. By the measures that were used, the vast majority of players seems to prefer the less risky areas of the virtual world. 78 % of the characters were located on a given time at high security areas, where they are mostly safe from attacks of other players. According to this measure, the players prefer less risk to smaller payoffs. Some critique was voiced regarding the snapshot nature of the analysis, but the number likely gives a general indication of the player distribution anyway.

The price level measures shown at the presentation gave evidence of a more or less constant deflation in EVE. As all the players are, or have the possibility to be, both producers and consumers, a general inflation measure (similar to CPI) is somewhat difficult to form. As a workaround of this problem, the presentation included four different price indices: minerals (i.e. raw materials), primary and secondary production (i.e. intermediate product and end product producer indices), and consumer prices. What should be termed consumption (as opposed to investment) in a virtual world is open to discussion, but I figure this is also true for many real-world consumer products. Also, somewhat different methods of computing the indices were used, that is, chained and fixed-bundle approaches. The changes in the player’s preferences seemed to be quite fast, considering the very different results the different weight update methods gave. The bundle weights were in all cases based on observed shares of total expenditure. Regardless of the measure that was used, the indices showed evidence of deflation during the course of the last 12 months.

UPDATE #1: The QEN was actually published while I was writing this blog entry🙂

The fundamental reason underlying the observed deflation is still an open research question, which actually leads to the last thing I had in mind, namely the

Research co-operation between HIIT and CCP

The main reason for there being a researcher from HIIT at the Fanfest was the recent launch of research co-operation between HIIT and CCP. The co-operation agreement allows us at HIIT to conduct empirical studies of a virtual economy in a way that’s not been possible before. EVE Online is a particularly interesting case for us, as all players take part in the same instance of the virtual world, effectively making the number of agents far larger than in most other virtual economies. There’s been a lot of theoretizing on virtual economies during the last few years, and we now hope to get some flesh around those bones, and get the results published on academic forums.

This was a brief announcement only, and there’ll be more to post later on.